Hays, the former conglomerate which is turning itself into a specialist recruitment and personnel company, executed a U-turn yesterday by indicating it might dispose of its unwanted mail-business through a stock market flotation.
The group, which has already raised £355m by selling off its commercial and logistics divisions, said that it was examining all options for its private postal business, including a public offering.
When its chief executive, Colin Matthews, announced the break-up of the group a year ago, he explicitly ruled out a flotation of any of its unwanted businesses on cost grounds. Mr Matthews said he did not want the expense of hiring three sets of advisers to float the three businesses and then hire them all over again when the newly demerged companies were picked off by larger predators.
He would not give a precise timescale for when Hays hoped to complete the disposal of the mail division, whose best-known division is the DX document exchange operation. But Mr Matthews said that he expected to leave the group during this calendar year, by which time "the mechanism, timing and strategy" for disposing of it would have been decided.
The mail business, which recently began collecting, sorting and delivering business-to-business mail following the liberalisation of the UK postal market, is valued at £200m to £300m. Together with about £70m of further property disposals in the pipeline, this would enable Hays to raise between £650m and £700m from the disposal programme - the top end of analysts' expectations.
Pre-tax profits for the six months to the end of September rose 9 per cent to £83m in line with forecasts. Hays personnel division, which will form the core of the company once the mail business has gone, increased operating profits by 12 per cent to £60m.
Denis Waxman, the head of the personnel division and chief executive-designate, said that net fees were up by 5 per cent despite continued weak demand for staff in South-east England, which accounted for 30 per cent of the personnel division's £623m turnover. Hays said it remained "cautious" on the outlook for the personnel division.